Don Trone Blasts DOL Fiduciary Plan
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DOL's Proposed Fiduciary Rule Don Trone Blasts DOL Fiduciary Plan Summary: Don Trone, often referred to as the "Father of Fiduciary," testified at a Department of Labor hearing on Thursday that its proposed fiduciary rule making would have failed to stop famed Ponzi schemer Bernie Madoff, and that more fiduciaries than brokers have stolen money from investors. Source: Thinkadvisor.com Perez Says DOL Will Move Forward With Fiduciary Rule Summary: Responding to a bipartisan letter from more than a dozen members of the U.S. House of Representatives, Labor Secretary Thomas Perez says his agency will "move forward towards issuing a Final Rule" on the agency's "conflict of interest" proposal. Source: Asppa.org DOL Fiduciary Standard: Here's What's Next Summary: After four days of public hearings, in which dozens of participants weighed in, the Labor Department is one step closer to implementing a new fiduciary standard, the scope of which heartens supporters and troubles critics. What are the DOL's next steps? Source: Benefitnews.com The DOL Fiduciary Proposal: Investment Education Vs. Advice Summary: The DOL's proposed regulation re-defining who is an ERISA fiduciary would, among other things, supersede current rules on investment education. This article provides background on the education vs. advice distinction and on the current rules. It then reviews the DOL proposal and conclude with a discussion of the issues it presents for sponsors. Source: Octoberthree.com Disclosure: The Riddle Wrapped in a Mystery Inside an Enigma Summary: Author writes, "The Fiduciary Wars now raging at full pitch in Washington, D.C...are, at base, about the Golden Goose of IRA money. The overriding issue the folks in D.C. are grappling with is how to bring business models that are rife with inherent conflicts of interest into accord with a best interest/sole interest fiduciary standard." Source: Morningstar.com
General Items Follow the Money: What Happens to the Proceeds of Class Action Settlements Summary: When you read in the paper about a large settlement in an excessive fee case or other claim involving a 401k, ESOP or other ERISA governed plan, do you think about what happens next, and about how to distribute the money among the plan participants? Source: Bostonerisalaw.com Big Changes Ahead for Small-business Retirement Plans Summary: Roughly half of the U.S. states are working to create government-sponsored automatic IRA plans that would enroll workers without access to employer-sponsored retirement plans. There is a regulatory sticking point, though: Will the plans be governed by ERISA. Source: Thefiscaltimes.com The Cost of Procrastination - Infographic Summary: Procrastination affects all of us at some time or another, especially when it comes to financial matters. On average, most people started planning an average of 10.6 years later than they said they should have. So what does procrastinating for a decade cost? Source: 401khelpcenter.com
Fiduciary and Plan Governance Material The Fiduciary Duty to Monitor -- 401k Plan Investments Summary: This article discusses the application of basic principles to the selection of plan investments and investment managers. It further considers this issue exclusively in the context of a 401k plan intended to comply with ERISA section 404(c), in which participants choose investments from a fund menu. Source: Octoberthree.com The Significance of a Signature Summary: In signing any retirement plan related contract, "the Client" is attesting that it is qualified to approve the contract and that it comprehends it fully. But, not many signers really do not fully comprehend the ramifications of the ERISA plan service agreements they execute with vendors. And that's dangerous because if anything goes wrong, it is on "the Client." Article looks at a case study. Source: Rolandcriss.com
Insight: Studies, Research and White Papers DC Retirement Plans Are Cost-Effective Summary: Critics of DC plans argue that DB plans are more cost-effective because the latter deliver higher investment returns and convert retirement savings into annuities. This paper investigates whether such assertions hold up to empirical scrutiny. Source: Manhattan-Institute.org Are 401k Investment Menus Set Solely for Plan Participants? Summary: This reports key findings are: Mutual fund companies that are trustees of 401k plans must serve plan participants' needs, but they also have an incentive to promote their own funds; The analysis suggests that these trustees tend to favor their own funds, especially their poor-quality funds; That 401k participants do not offset this bias by shifting their savings away from trustee-affiliated funds; and, Fund companies serving as trustees often make decisions that appear to adversely affect employees' retirement security. Source: Bc.edu
Plan Communications Adopt a No-Surprises Policy for Your Plan Communication Summary: Taking a no-surprises approach will help you avoid potential gaps in your communication program and minimize your liabilities. Over time, your employees will have a better awareness and appreciation of their plans. Source: Benefitscanada.com
Legislative and Washington DC Retirement Planning Techniques May Be Shut Down Summary: A proposal focuses on creating a 28% maximum tax benefit for contributions and accruals of benefits inside of an individual's 401ks, defined benefit plans, and IRAs. Source: Schneiderdowns.com
Compliance and Regulatory DOL Proposes Definition of Investment Advice Summary: The current definition of "investment advice" and the DOL's proposed definition of investment advice are substantially different. The proposal, if adopted as a final regulation in its current form, will have a substantial impact on the providers of investment products and services to ERISA-governed plans, IRAs, and similar arrangements. Source: Groom.com IRS Announces the End of the 5-Year Determination Letter Remedial Amendment Cycles Summary: The IRS announced that the staggered 5-year determination letter remedial amendment cycles for individually designed qualified retirement plans will be eliminated as of January 1, 2017. Generally, this means that sponsors of individually designed plans will no longer submit plans to the IRS for review every five years to obtain a new favorable determination letter. Source: Drinkerbiddle.com
Marketplace News Legacy 401k Partners to Register as RIA Cambridge Introduces On-Line Retirement Resources
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